I think Alfred really saw them, one reason is because Alfred never say Selina as Catwoman nor her interaction with Bruce. I may be wrong. If they would had blurred Selina out of focus at the cafe and had just shown Bruce sitting with a lady then I could possibly except it as a dream, however it was to explicit it wasn't

Plus there were a few signs that showed he was alive; autopilot fixed, and bag for John Blake.

Yea you're right Alfred never saw Bruce and Selina together. But he knew knew who she was and that Bruce was interested in her.